Legal principle

An importer's burden of disproving unjust enrichment under Sections 27 and 28D of the Customs Act, 1962 is discharged by an audited Chartered Accountant's certificate with supporting documents showing the duty incidence was not passed on, unless the Revenue leads contrary evidence to rebut it.

Court decision

The Tribunal allowed the appeals, setting aside the impugned order on the question of unjust enrichment and granting the appellants consequential reliefs; it held that the Chartered Accountant's certificate (based on audited books and supported by annexures showing calculations) had to be accepted since Revenue adduced no contrary evidence that the duty incidence was passed on, and respectfully followed the Yu Televentures line of decisions affirmed by the Supreme Court.

Facts

M/s Nokia India Sales Pvt. Ltd. imported mobile phones (sub-heading 85171290, Customs Tariff Act 1975) under 30 bills of entry between October 2014 and January 2015, paying CVD @ 6% and NCD @ 1%, and later claimed refunds of Rs. 27,78,339/- and Rs. 31,29,645/- on the strength of the Supreme Court's decision in SRF Ltd., claiming eligibility for concessional CVD @ 1% under Sl. No. 263A of Notification No. 12/2012-CE. The original authority rejected the refund, holding that the conditional exemption could not be claimed belatedly without challenging the assessment, that the importer failed to disprove the Section 28 presumption that the duty burden was passed on to buyers, and that refund claims for 4 bills of entry were time-barred under Section 27. The First Appellate Authority accepted the assessment contention (following Micromax Informatics, Delhi HC) but rejected the appeals on the ground of unjust enrichment. The importer then appealed to the CESTAT, Hyderabad.

Key provisions

• Section 27, Customs Act, 1962 — Claim of refund duty
• Section 28D, Customs Act, 1962 — Presumption that incidence of duty has been passed on to the buyer